Only 15% of voice of customer (VoC) efforts are considered “very successful”* by their managers, according to the Temkin Group’s State of Voice of Customer Programs 2016 report. Performance in the 2023 Qualtrics State of CX report is remarkably similar! What’s broken?
Just 34% say their VoC program is “good” or “very good” at making changes to the business based on VoC insights.
So why is it that two-thirds of VoC efforts aren’t making a difference? 4 root causes:
You get what you measure. Transaction surveys aren’t actionable by the rest of the company, who are contributing to pebbles in customers’ shoes. Emphasis on a survey index score focuses execs’ attention on what the customer is doing for the company rather than what the company is doing for the customer. Survey index scores are treated by most companies like SPC — statistical process control — where performance within a “safe range” means business-as-usual is okay. Instead, focus on action plan progress metrics.
You get what you ask for. Asking about your brand is not the same as asking the customer about them. Change phrasing such as “how knowledgeable is X” to “how informative is X”. Knowledgeability and similar phrases require customers to judge you, whereas Informative and similar phrases give you the same information from customers’ viewpoint. Response rates are higher when customers talk about themselves. VoC reports do not speak the language of managers. They do not translate survey averages and percentages into dollars represented by the customers with varying sentiments. When they do, it’s about revenue boost by adjusting customer-facing elements. That’s not about driving changes to the business. Instead, present sentiment in terms of customer lifetime value, or at least as a percentage of current revenue or profit.
You get what you aim for. Customer experience maturity models place organizational adoption and accountability for driving business change per VoC at the tail-end of the customer experience management effort. This reflects the unfortunate current reality, but it does not guide managers to set themselves up for success. Most customer experience technology providers, and many consultants, do not have personal career experience in driving business change — and their self-interest is elsewhere — so this critical success factor gets glossed over rather than placed at the outset. Instead, it’s essential to figure out how you want to drive business change before investing in VoC.
You get what you empower. VoC managers admit that they aren’t equipped to drive changes to the business. Their charter is to solicit and report feedback from customers. VoC technologies are designed to drive quick fixes for individual customers — not to drive changes to the business. Skills, authority, bandwidth of VoC managers — and company mindset — are not set up to make changes to the business based on VoC insights. Instead, set up VoC as a determinant of corporate strategy and a shaper and refiner of all business strategies, processes, policies, structures, and rewards.
Another reason why VoC ROI is low is the use of the word “program”. Ban this word! “Program” implies temporary, siloed work. Totally the opposite of what customer experience is. See more here: CEOs: CX/EX are NOT Programs.
Only 4% of of Voice of the Customer (VoC) efforts are transforming customer experience.
More than half are stuck in analysis paralysis, according to the Temkin Group’s State of Voice of Customer Programs 2016 report:
— 4% are VoC Transformers — linking customer insights to operational data and processes and strategic planning throughout the company.
— 39% are VoC Collaborators — tailoring customer feedback to stakeholders who are diligently engaged in continuous improvement.
— 41% are VoC Analyzers — spending the majority of their time finding insights from VoC data.
— 14% are VoC Collectors — just getting started in selecting listening posts, questions to ask and metrics to use.
— 2% are VoC Novices — in the early stages of developing their VoC approach.
2023 Qualtrics State of CX update:
“Just 3% of organizations reached the highest stage of maturity, Embed (Transformers). More than two-thirds of organizations fell into the first two stages of maturity, Investigate (36%; Novices) and Initiate (31%; Collectors).”
Note that it has been 15 years now since the 2008 global financial crisis when companies began investing heavily with CX tech/advisory firms.
The upper two categories are the necessary threshold for customer experience management (CXM) return on investment (ROI). The lower 3 categories are akin to analysis paralysis: they are not respecting customers by making things better according to their feedback.
In many cases the Collaborator level (as interpreted by Temkin’s respondents) falls short of making a dent in CXM ROI: escalated fixes for individual customers may use more resources than the value they achieve — it’s essential to make enduring improvements your whole customer base will reward.
The interesting thing is that there is no need to trudge through these categories. It is certainly possible, and highly recommendable, to plan your VoC strategy from the start at the VoC Transformers level.
This is what we did when I led customer experience transformation for many years at semiconductor equipment maker Applied Materials. The first VoC results were discussed in-depth by the entire C-team in an all-day enterprise customer experience strategy offsite meeting.
After they developed a shared vision for transforming customer experience company-wide, they decided that every business unit and account team should study their own cut of the data, in workshops where cross-functional participants read customer comments about a key driver of customer loyalty, to determine root causes and develop action plans to resolve the root issues.
In these annual workshops I guided them in identifying internal metrics to track the progress of their action plans, and my team collected their progress metrics quarterly for review by the C-team at the same time they prepared for the investment analysts’ call. The C-team focused on these action plan metrics in each business unit’s and account team’s bonus formula.
My team scheduled our VoC reporting to coincide with early stages of the company’s annual planning process, and showed each functional area how they could use VoC to shape their work. By starting our VoC efforts in this way, we were able to provide results at the VoC Collaborator and Transformer levels the first two years and onward.
Lesson 1: Ensure the whole C-team has a shared vision and personal commitment for each of their respective organizations’ role in making a difference based on whatever the VoC findings may reveal. Do this first. Don’t wait to see what the data says.
Lesson 2: Present VoC findings in the language your stakeholders speak: size of business at-opportunity or at-risk, coinciding operational and sentiment shifts, precious resources wasted, opportunity to re-channel budget/resources by resolving root issues, and timely availability of insights for strategic direction-setting and decision-making. Involve stakeholder representatives in helping you do this before publishing/presenting.
Lesson 3: Expect action and accountability from everyone. If you want to be rewarded by your whole customer base, strive to prevent recurrence of chronic issues. This requires cross-functional collaboration. Set up systematic workshops and other routines to make it easier for people to build passion together in tackling silos and imperfect processes and policies. Set up incentives for specific behaviors — if you carefully identify the right behaviors the results will speak for themselves. Have this planned out before you invest in VoC — or before you make further VoC investments!
*Note: 63% say their VoC program is “somewhat successful”; the remaining 22% are relatively indecisive about their VoC program’s success.
Image purchased under license from Shutterstock.
